Cassidy and Associates’ chief executive Marty Russo took a buyout Wednesday amid a staff shakeup at the lobbying firm.

The former nine-term Democratic congressman from Illinois will step down at the end of the year, according to an internal e-mail obtained by POLITICO.

“My friend Marty Russo, our long time CEO, has chosen to take a generous buy-out offer…and will be leaving the firm, but not his many friendships, on December 31st. I will miss him here in the office, but as usual will see him regularly outside the office,” firm founder Gerald Cassidy wrote to staffers.

In a statement to POLITICO, Russo said: “Gerry Cassidy is a dynamic and innovative leader and very dear friend. I am pleased and proud to have been a part of Cassidy & Associates for almost 18 years. As the firm is undergoing some new changes, I have decided to accept a generous buyout. I wish Gerry the best of luck and look forward to my next Washington endeavor.”

Russo may not be the last high-profile departure. Many industry insiders expect that the firm’s chief operating officer, Gregg Hartley, may also leave.

Hartley, who was seen lunching with lawyer and super-agent Robert Barnett in October, did not respond to an e-mail.

The firm was laying off nearly 20 percent of its staff, including eight lobbyists and four support staff, Roll Call reported.

Cassidy did not return requests for comment.

The staff shakeup comes as the K Street institution, which helped pioneer earmark lobbying, faces a Republican House and Senate Republicans who have banned the practice.

The shifting political winds come as Cassidy’s revenue has been declining. In 2007, the firm brought in about $24.5 million, according to the Center for Responsive Politics. So far this year, revenues are only about $15.5 million.

In a bid to expand its defense practice, Cassidy acquired the Rhoads Group, a move announced last month.